Starwood Hotels demonstrates a relatively low-cost market research experiment in a new Internet medium.

When Chris Holdren, Starwood Hotels' vice president of Web services, commissioned the construction of one of its new Aloft brand hotels in Second Life last spring, he had no idea what to expect.

"Most of our projects are very focused on the return and the objectives, but for this there was no model for us to go on," Holdren says. Instead, he had to approach it purely as an experiment: "When we started, we didn't know if the hotel would last a month."

That's just what most corporate ventures into Second Life are today relatively low-cost experiments in a new Internet medium. But that does not mean they don't pay off sometimes in unexpected ways.

In an August press release, Starwood promised that the virtual hotel then under construction would provide a sneak peek at Aloft's "urban-inspired, loft-like guest rooms, landscaped outdoor spaces and energetic lounge scene." Although Starwood was clearly seeking publicity, Holdren professes to be astonished by just how much was generated by that notice and the October launch party that followed. The Virtual Aloft hotel was featured in dozens of newspaper stories, as well as magazines like Fortune. Months later, news features on Second Life still routinely mention Starwood as one of the corporate pioneers in the virtual world.

Starwood got attention for being the first real-world hotel in Second Life, just as American Apparel before it was the first clothing retailer. And this series of "firsts" continues to generate press; for example, with the February announcement from TMP Worldwide, an interactive agency specializing in recruiting ads, which claims to be the first to do recruiting and organize job fairs in Second Life.

At the time Holdren approved the project, the only mainstream press coverage he had seen on Second Life was a Business Week cover story that appeared in May, "so there was no reason for us to expect to get a lot of press for it."

The main reason for the project was to solicit feedback on the design of the hotel that Starwood promises would be reflected in brick and mortar when the first real-world Aloft hotels open in 2008.

The unveiling of the hotel gave Second Life residents the opportunity to hang out in the lounge, sit in the bar and talk with each other, or tour a sample guest room. One of the first bits of feedback concerned the guest room bathroom, which visitors didn't feel afforded enough privacy to someone sitting on the toilet. The designers belatedly realized they'd left out the bathroom door that was specified on the real-world blueprints because, as they explained on the project blog at Virtualaloft.com, "avatars do not spend much time in bathrooms." But since the omission bothered people, they quickly added the door.

"We've also gotten a lot of great feedback from the community that we are applying to the fabric textures and colors being used throughout the hotel," Holdren says, which is one reason he thinks Starwood has, in fact, gotten its money's worth. Without disclosing exactly how much he spent, he calls the cost comparable to what's required to field an ordinary Web site. "You can spend a lot on it, but you don't have to spend a lot on it," he says. In other words, thousands or tens of thousands of dollars, but not a million.

The actual construction was done by Electric Sheep, one of the premier virtual-world consulting companies, under the supervision of Electric Artists, a digital marketing agency. But Holdren made regular walk-throughs, sometimes in the company of the Aloft architects or company lawyers. That's part of what made it more like a real construction project than the construction of a Web site.

"We'd go in there, and the team would be putting up walls and adding textures to them," Holdren says. "When you suggest a change in Second Life, rays shoot out of the designer's hand, and it's changed right before your eyes."

Starwood's experience also shows some of the potential hazards of entering Second Life. If you toured the Aloft hotel during the first couple of months after the launch party, what you found there at most hours was a big, empty hotel. You could still sit in the lounge or tour a room, but the place was dead. Not exactly the vibrant new hotel experience the company wanted to portray.

"That is a major criticism on many of the 'corporate' builds here nice, but empty," says Gwyneth Llewelyn, a prominent Second Life citizen. While saying she prefers to withhold her real name for personal reasons, Llewelyn identifies herself as a technology and marketing consultant, and a veteran of several Internet startups, who lives in Portugal. She sees Second Life today as being much like the Web in the early 1990s, when browser technology was immature and many conservative companies were initially reluctant to set up shop side-by-side with the Star Trek and porn Web sites. So, companies like Starwood deserve credit, she says, for having the imagination to see beyond the current limitations of Second Life to the possibilities this technology holds for the future.

In retrospect, Holdren says he was so focused on getting the hotel open that he didn't stop to think what should happen next. Now he is working to revive the excitement around the virtual hotel by hosting more events and by providing more things for visiting avatars to do there, even when the place is deserted. For example, there's now a sort of vending machine that dispenses Starwood Preferred Guest cards, which visitors can then use to obtain a free bathing suit and the animations necessary to swim in the hotel's pool.

"It's not something you can just build and forget. It's something you have to maintain and keep focused on to keep it alive," Holdren points out. So, in late January the Virtual Aloft developers went back to work, tenting the entire hotel in a shroud marked "Under Construction," soon to be unveiled for the second time as a hotel Second Life residents ought to feel more of an attachment to since they helped design it.

David F. Carr is the Technology Editor for Baseline Magazine, a Ziff Davis publication focused on information technology and its management, with an emphasis on measurable, bottom-line results. He wrote two of Baseline's cover stories focused on the role of technology in disaster recovery, one focused on the response to the tsunami in Indonesia and another on the City of New Orleans after Hurricane Katrina.David has been the author or co-author of many Baseline Case Dissections on corporate technology successes and failures (such as the role of Kmart's inept supply chain implementation in its decline versus Wal-Mart or the successful use of technology to create new market opportunities for office furniture maker Herman Miller). He has also written about the FAA's halting attempts to modernize air traffic control, and in 2003 he traveled to Sierra Leone and Liberia to report on the role of technology in United Nations peacekeeping.David joined Baseline prior to the launch of the magazine in 2001 and helped define popular elements of the magazine such as Gotcha!, which offers cautionary tales about technology pitfalls and how to avoid them.